Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
17 Jul 2025
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 2 lakh on The Mandvi Nagrik Sahakari Bank Limited, Mandvi, District Surat, Gujarat, for non-compliance with RBI directions on 'Management of Advances - UCBs'. Following a statutory inspection and consideration of the bank's reply and personal hearing, RBI held that the bank had failed to ensure end-use of funds with respect to a loan sanctioned by it. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Why RBI Acted
RBI imposed a monetary penalty on The Mandvi Nagrik Sahakari Bank Limited for non-compliance with certain directions issued on 'Management of Advances - UCBs'. After statutory inspection, supervisory findings, and consideration of the bank's reply and oral submissions, RBI sustained the charge that the bank had failed to ensure end-use of funds with respect to a loan sanctioned by it. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must absorb the penalty and continue operating under RBI supervision, with no stated restriction on its business in this release. The order is a compliance sanction and does not validate or invalidate any underlying customer transaction or agreement.
Regulatory Basis
- Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 2.00 L
- Order Date
- 11 Jul 2025
- Effective From
- 11 Jul 2025
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank